By any measure, this is an important book. Its ambition is suggested by its English title—its focus, by its German title: Die neue Ordnung auf dem alten Kontinent: Eine Geschichte des neoliberalen Europa (2014). Specifically, it is on how economic problems led to the diminishing luster of a great social dream. That dream was embodied by the heartfelt discourse of 1989, emphasizing Solidarność (Polish for solidarity) and lidskost (Czech for human compassion) in a “Europe whole and free” (Willy Brandt). How this communal vision became a problematic neoliberal experiment gives the book its trajectory. Yet, as Philipp Ther also shows, disillusionment has been punctuated by new bouts of hopefulness and searches to recover the solidarity and the sense of “human dignity” (in Polish, godność; in Ukrainian, gidnist´) that marked the revolution of 1989. That it was a genuine revolution—in its circumstances, its scale, its spirit, its process, and its outcome—he does not doubt. But revolutions, Ther avers, are not, in essence, political. It is their transpolitical spirit that gives them their inclusive dynamism. But it also gives them a utopian component that does not square readily with messy political and economic realities. The phrase human dignity has both a communitarian and a libertarian dimension. If those aspects sat uneasily together in the events of 1989, they have torn at each other ever since.

In many respects, Ther's book is a brief against neoliberalism. With “the end of history” in 1989, many Westerners were quite sure they possessed the economic and political prescriptions—liberalization, monetarism, deregulation, privatization—that were necessary to cure the Eastern patient. Instead, argues Ther, Eastern afflictions infected the West. But even worse, the prescriptions often aggravated the disease. Far from immune, the West now faces a shattering climax of disillusionment and recrimination, with political as well as economic repercussions.

Neoliberalism, Ther is careful to say, is “a neutral, analytical term” (x) whose varied influence must be painstakingly assessed. Postcommunist countries that eschewed neoliberal reforms, he concedes, fared even worse than those that embraced them. And many of the reforming economies did very well during significant stretches of time: Poland, Slovenia, the Czech Republic, Hungary, Slovakia, and the Baltic states. Yet, even so, Ther denies that shock therapies produced growth or prosperity: “Such a simple causal connection cannot be proven.” Instead, he argues that the differentiated “economic performance of the postcommunist countries” was a function of their “social capital” (x). Thus, Poland succeeded because many Poles had long been dealing entrepreneurially, on the black market or otherwise, with the economic stagnation of the communist era.

Were the economic difficulties of Eastern Europe in the 1990s the consequence of “the actual revolutionary process or of the subsequent, top-down transformation” (76)? The question presupposes a rather stark distinction between popular revolutionary agency and the actions of new elites. The lack of popular revolutionary violence, the negotiated nature of the power transfer, the lack of sweeping purges and popular tribunals—in short, the relatively orderly way in which popular forces triumphed—permit Ther to dismiss the former possibility. This would seem to leave the latter: by using the Thatcherite argument that “There Is No Alternative” (dubbed TINA), neoliberal elites turned Eastern Europe into a laboratory for “big bang” solutions. Shrinking economies, massive unemployment, emigration, bank crises, firesale privatizations, collapsing tax revenues, enormous budget deficits, and the specter of state bankruptcies all followed. In a chapter titled “Getting On the Neoliberal Bandwagon,” nearly all the calamities are laid at the feet of neoliberal reformers. Yet, at the same time, Ther grants that nowhere were neoliberal prescriptions followed slavishly. Everywhere, adjustments were made—nearly all of which, however, produced one form or other of collateral damage.

For Ther, Germany represents the “most radical” (85) case of shock therapy. With the East-West currency union of 1990, he argues, East German goods became four times more expensive than before (and twelve times more expensive in Czechoslovakia); as markets evaporated, whole sectors of the economy dried up. Yet, somewhat contrary to the thrust of Ther's narrative, the 1:1 conversion rate was not an economic but a political decision. The same was true of Bonn's extension of social benefits and protective labor regulations eastward. By driving up labor costs without sufficiently compensatory infrastructural improvements, both moves undermined East German competitiveness. East German goods could not compete with Western goods, and East German labor was further squeezed by cheaper Eastern European labor. Western transfer payments ended up paying primarily for unemployment benefits, and unsustainable federal deficits eventually led to “cotransformative” manifestations in the West (150).

Significant among these cotransformative manifestations were the Hartz social and labor market reforms of 2003–2005. While these reforms affected more Eastern than Western Germans, their impact, Ther avers, was more “unsettling” (282) in the West. Though enacted by the left-of-center “Red-Green” government of Chanceller Gerhard Schröder, the Hartz reforms mandated deep cuts in the welfare state: henceforth, unemployment benefits were to be means-tested—regardless of past contributions, which had naturally been larger in the West. Beneficiaries were also required to perform community service. Meanwhile, a state-subsidized “low-wage sector” (Niedriglohnsektor) was created to help offset the Eastern European (i.e., extra-German) labor competition. Across the country, writes Ther, the Hartz reforms heightened income inequality—with one “paradoxical” silver lining: by improving interregional empathy, the shared experience “helped the two parts of Germany … to approach the politically desired ‘inner unity’” (282).

To be sure, privatization in Eastern Germany in the 1990s had produced a glut of businesses available for purchase, with the supply-and-demand consequence that, instead of making a profit on the sale, the state suffered a multibillion-dollar loss. But in light of the sudden and consequential Communist collapse, Ther may be overly faulting the neoliberal remedy. Trying to soften the resultant firesale, another “neoliberal” government quite un-neoliberally facilitated the comparable transaction in the Czech Republic by prevailing upon the banks to ease their lending requirements—which led to the Czech banking crisis of 1996. In Russia, privatization involved auctions run by oligarchs with inside information and control over entire markets, which were consequences not of neoliberal premises but of corruption and communist cronyism. As Ther notes, neoliberalism actually requires a proper governmental infrastructure, not simply vacating an improper one.

With erudite chapters on the origins and nature of the revolution, Ther definitely does not deny—yet seems, at times, to put aside—the reality that many of the problems he describes had their roots not in neoliberalism but rather in the Communist rot that it tried to address. Furthermore, winning the Cold War was itself the source of dislocations. The resultant new competition in both goods and labor—not just from Eastern Europe but also from China—meant that some issues of outsourcing and relative regional competitiveness arose from the sheer scale of the ideological victory. Compounding the matter of the globally expanded labor market was the digital productivity revolution. Ther statistically explores the growing urban/rural discrepancies in the postcommunist states and comments as well on the advent of a West German rust belt. But he only briefly mentions computers, the internet, and the productivity boom. These omissions would seem to undermine a systemic premise faulting neoliberalism, unless one is also prepared to argue either that the resultant global wealth gains are unrelated to the neoliberal entrepreneurial climate in which they happened, or that they would have been better eschewed than inequitably distributed.

What Ther explicitly does argue is that neoliberal economic policies aggravated the inherited or inherent problems. This approach is certainly fruitful: one learns a great deal by documenting the effects of actions taken. But Ther's statistics also show dramatic and sustained turnarounds. Moreover, whether other actions (or no action) would have produced superior outcomes is difficult to evaluate. To try to do so, Ther deploys both cross-geographic and cross-temporal comparisons. But, as he points out, the region's diversity is less useful for drawing systemic conclusions than for underscoring how differing initial conditions led to differing path dependencies.

It is there that Ther excels. Parsing specific cases, he combines a modicum of numerical data with illustrative anecdotes to show how hands-off policies, rogue players, and the absence of new governmental or regulatory infrastructures aggravated the swings within the emerging Eastern economies. Further data, and examples of successful Eastern entrepreneurialism, document the “social capital” thesis—or, as he also puts it, “the supreme importance of transformation from below” (328). Data are illuminatingly organized, with case studies grouped geographically and temporally to explore patterns and trends. Moreover, Ther pays close attention to the reality that “shock therapy” did not and could not take place in isolation from extra-regional partners. Linkage to powerful Western economies, agencies, institutions, policymakers, and eventually (and most beneficially) “cohesion policies” (transfer payments from the European Union), differentially affected the course of entrepreneurialism and competitiveness across Eastern Europe. Furthermore, linkage was not a one-way street. Ther thus circles back from the specifics of his case studies to assert a point in keeping with the transcendent scale of his title: the resultant fluctuations in Eastern policies, fortunes, discourses, and norms all eventually “cotransformed” the West. Ther's larger thesis, then, is that the economic crisis of 2008, and the contemporary Western phenomena of “PIGS countries” (i.e., the catastrophic sovereign debt in Portugal, Italy, Greece, and Spain), Brexit, Euroskepticism, and transatlantic populist neonationalism, all took their cue from developments in the East. For Ther, all these developments, in one way or other, are about aspects of neoliberal disillusionment. Moreover, much of the disillusionment is, in his view, justified.

Ther chooses to end his book with a clever parable. In it, the doctrinaire crew of a “shiny express train” (neoliberalism) lures passengers awakening from an inspiring social dream (“1989”). As the train accelerates, the passengers become nauseated. For a time, some recover; a few even start to feel better than ever. But eventually “the train overheat[s].” Passengers shed their clothes (the welfare state), then join the crew in panicking as the train screeches to a halt (the financial meltdown). Amazingly, the train does not derail. But when it starts up again, no adjustments are made. Instead, new passengers climb aboard from Southern Europe, who dine exclusively on credit. A German woman, who some of them think is the train's new engineer, refuses their requests for further credit. By now, almost everyone aboard the train is growing thin, cold, and furious. On an adjacent track, they spot an even faster train, this one from China. Ther leaves his parable unfinished, but at this point, some of the passengers on the moving Euro-train are contemplating abandoning the train (330–33).

While Ther's parable is alluring, neither the train nor the German woman may be as categorically at fault as Ther's employment of this parable implies. For the precise achievement of Ther's book lies not in shooting down neoliberalism, but rather in exploring the ramifications of actual policies, including the many variants or digressions from neoliberalism in certain actual situations. Indeed, the positive role that Ther earlier assigned to unshackled “social capital” (flexibility, innovation, resourcefulness, and entrepreneurialism!) might still speak, on balance, to the congeniality of neoliberal incentives. Further questions arise regarding cotransformation in Southern Europe, whose context and social capital Ther finds decidedly less conducive to Eastern-style reforms. In any case, the Southern reforms, which have been only partial and tepid at best, hardly seem to qualify as examples of neoliberal folly. Finally, if a causal link between shock therapy and growth really “cannot be proven” (x), then a comparably unreachable standard of proof would seem to apply to any contrary claim about policies and their effects.

But one need not join Ther in his differing assessments in order to laud the rich and stimulating effect of his analysis. Certainly, the antiglobalist political convulsions of 2016, and the transatlantic ramifications that continue to unfold, constitute a new type of worldwide shock, though one might hesitate to call it shock “therapy.” Not just historians, then, will need to come to terms with Ther's rewarding history as an essential contribution to contemporary self-understanding.